Steps You Can Take to Boost Your Workers’ Financial Wellness

Last year, financial worry increased among Americans, according to polling organization Gallup. A recent Bankrate survey showed that many Americans can’t even come up with $500 for an emergency expenditure. In fact, just 41% of adults would pay an unexpected expense using their savings.

The reality is that financial stress is very real for many of your employees. So it’s no surprise that there is a growing emphasis on employee financial wellness programs. If you don’t have a financial wellness program in place at your company, now is the time to implement one.

Why financial wellness programs matter

At first glance, it may seem like your employees’ financial wellness isn’t your issue to deal with. You might be surprised to discover that the financial stress your employees feel is actually impacting your bottom line.

The latest financial wellness survey conducted by PriceWaterhouseCooper indicates that you could be losing money by way of productivity and profitability due to the money problems weighing on your employees’ minds.

Employees feeling financial stress are more distracted at work – and may even spend time at work trying to solve their problems.

On top of that, employees feeling financial stress are more likely to experience health problems as a result, and call in sick. They could even be driving up your health insurance costs.

The survey also indicates that financially stressed employees compound their problems by withdrawing money from their retirement funds in order to meet emergency needs. As millennial and Gen X employees continue this practice, they will not only be stressed today, but worried about retirement down the road.

A significant number of millennial (40%) and Gen X (31%) employees are concerned that their student loans are holding them back from achieving their financial goals.

All of this stress can impact performance and your company bottom line. If you want to see an improvement in performance, consider some of the following ideas to help your employees improve their financial wellness:

Offer classes and workshops

One way to help employees get a handle on their money is to offer classes and workshops about financial concepts. Provide workshops on basic concepts like budgeting and helping employees understand their retirement plans.

Work with Certified Financial Planners® and Registered Investment Advisors who can offer unbiased information and provide solid strategies and tips to your workers. Even offering an eight-hour financial management course can go a long way toward providing your employees the tools they need to improve their finances.

It’s also possible to provide access to personal financial planning resources so your employees can receive the help they need when navigating their long-term money goals.

Provide free credit monitoring

Some companies include credit monitoring as one of their employee benefits. It’s possible to work with credit bureaus to allow your employees access to their credit scores and reports. Providing this benefit, along with workshops and financial planning help, empowers your employees to improve their credit.

Consider adding student loan repayment as a benefit

Among millennials and some Gen X employees, student loans are a major source of financial stress. Alleviate some of that by adding an option to put a portion of each paycheck toward student loan repayment. Student loan repayment as a benefit is growing in popularity, and you can attract talented workers by offering it as an incentive.

Add a 529 plan benefit

According to Gallup, 73% of parents with children under the age of 18 worry about the cost of college. While a student loan repayment benefit can help your younger employees feel less stress about their finances, a 529 plan benefit can do the same thing for older Gen X employees and baby boomer employees worried about paying college costs.

Automatic retirement plan enrollment

Rather than wait for your employees to sign up for retirement benefits, automatically enroll them. This encourages them to save for retirement without thinking about it. Automatic enrollment is quickly becoming the norm in 401(k) plans, with over 67% of plans offering it. The most common auto-enrollment rate is still 3%, but recently we have seen a large movement toward 4%.

Also, make it easy for your employees to join your plan or increase the amount they withhold from each paycheck. Studies show that the faster an employee is able to enroll in your plan, the more likely they are to enroll and stay. Shorten your eligibility period and make entry more frequent. Once they see how their retirement accounts are growing, they are less likely to be stressed about the future.

According to the Consumer Financial Protection Bureau, a company can save up to $3 for every dollar spent on financial wellness programs, which if true, is a great return on investment.

Even if the results aren’t immediately quantifiable, once you implement a financial wellness program for your employees, they will be happier and more productive. They will worry less about the future and be able to focus more on work while they are at work.